Entities Engages in Inter-Korean Business Under Audit
By Kim Yon-se
Staff Reporter
The Board of Audit and Inspection (BAI) has strengthened its monitoring of private organizations specialized in inter-Korean businesses to prevent possible illegal fund usage.
``Since late November, we have been conducting inspections on several private entities engaged in inter-Korean businesses to see whether they have inappropriately used money provided by the government,'' a BAI official said Wednesday.
But he added that the inspection is not applicable to all businesses for inter-Korean cooperation.
An official of the Ministry of Unification said, ``The National Assembly demanded the BAI carry out inspections on the money usage. We've handed over documents to the BAI.''
The state audit agency plans to deal with possible unauthorized practices according to the law and instruct the Unification Ministry to map out measures to prevent irregularities.
According to sources, the BAI has allegedly uncovered several cases where the inter-Korean development funds have been used improperly, based on its inquiry into about 50 organizations funded by the Export-Import Bank of Korea since 2005.
Last year, the main opposition Grand National Party (GNP) initially called for a cut of more than 5 trillion won including a ``larger reduction in inter-Korean cooperation funds'' for 2008.
But after its candidate Lee Myung-bak won the presidential election on Dec. 19, the party changed its stance and agreed to cut government spending by a smaller margin.
In the wake of Pyongyang's nuclear test in October 2006, conservatives, led by the GNP, continued to demand significant reductions of the budget.
The inter-Korean exchange fund was created in 1991 to help support North Korean policies and business deals with the North.
It consists of both government and commercially raised money. Local companies seeking business with North Korea may apply to the Unification Ministry for loans at a 6 percent interest rate.
The government compensates up to 90 percent of any losses incurred from inter-Korean deals.